Exhibit 10.1
SANDERSON FARMS, INC.
SHARE
PURCHASE AGREEMENT
(Management Share Purchase Plan)
(Employee Agreement)
This SHARE PURCHASE AGREEMENT (this
“Agreement”), made and entered into as of the ___day of
___, 20___(the “Grant Date”), by and between ___(the
“Participant”) and Sanderson Farms, Inc. (together with
its subsidiaries and affiliates, the “Company”), is
hereby amended and restated in its entirety as follows as of the 26
th day
of April, 2007, to set forth the terms and conditions of an Award
of Share Purchase Rights granted pursuant to the Sanderson Farms,
Inc. and Affiliates Stock Incentive Plan, adopted on
February 17, 2005 (the “Plan”) and this Agreement.
Any capitalized term used but not defined herein shall have the
meaning ascribed to such term in the Plan. The term “Fiscal
Year” shall mean the fiscal year of the Company which begins
on November 1 of each calendar year and ends on October 31 of
the next calendar year.
1.
Rights to Purchase Restricted Stock.
(a) Base Salary Reduction .
The Participant may elect to reduce his base salary by a specified
percentage thereof (not to exceed 15%) and, in lieu of receiving
such salary, receive a number of Shares of the Company, subject to
the terms, conditions and restrictions set forth herein
(“Restricted Stock”), equal to the amount of such
salary reduction divided by a dollar amount equal to the Fair
Market Value of a Share on the date on which such Restricted Stock
is received. In the first year of the Participant’s
eligibility to participate in the Plan, an election to reduce the
Participant’s salary for the period of that initial year of
eligibility subsequent to the election must be made within
30 days after the date that the Participant becomes eligible
so to participate (the “Initial Election Deadline”). An
election so made during the initial year of eligibility
(“Initial Salary Election”) shall become irrevocable on
the Initial Election Deadline and shall be effective beginning with
the first pay period that ends after the Initial Election Deadline.
Any election to reduce salary otherwise payable in a calendar year
after the Participant’s initial year of eligibility shall be
effective beginning with the first pay period that ends after
January 1 of the calendar year next following the calendar year in
which such election is made (and shall become irrevocable on
December 31 of the calendar year in which such election is
made with respect to the next calendar year). Any cancellation of,
or other change in, any such salary reduction election shall become
effective as of the first pay period ending after January 1 of the
calendar year next following the calendar year in which notice of
such cancellation or change is filed (and any such notice shall
become irrevocable on December 31 of the calendar year in
which it is filed with respect to the next calendar year).
Any salary reduction hereunder shall
apply ratably to the Participant’s salary for each pay period
covered by such election. Restricted Stock shall be issued for the
account of the Participant, or allocated to the account of the
Participant from Shares previously purchased by the Company, in
respect of such salary reductions on the last business day in each
calendar quarter ending March 31, June 30,
September 30 and December 31 (each such date, a
“Quarterly Allocation Date”). The number of shares of
Restricted Stock issued or allocated to the Participant on each
Quarterly Allocation Date shall be based upon the aggregate salary
reduction for pay periods ending since the next preceding Quarterly
Allocation Date and the Fair Market Value of a Share on such later
Quarterly Allocation Date. Fractional shares will be issued (or
purchased) where necessary.
If a Participant who has elected
salary reductions hereunder shall terminate employment before
shares of Restricted Stock are issued or allocated in respect of
all such salary reductions, any salary reduction amounts in respect
of which Restricted Stock has not been granted by the date of
Participant’s termination of employment shall be returned to
Participant promptly in cash, subject to compliance with the
requirements of Sections 409A(a)(2) and (3) of the
Code.
(b) Bonus Reduction . The
Participant may also elect to reduce his annual bonus compensation,
if any, by a specified percentage thereof (not to exceed 75%) and,
in lieu of receiving such bonus, receive a number of shares of
Restricted Stock equal to the amount of such bonus reduction
divided by a dollar amount equal to the Fair Market Value of a
Share on the date on which such Restricted Stock is received. An
election for the bonus payable with respect to the Fiscal Year
ending October 31, 2005 and for the bonus payable with respect
to any subsequent Fiscal Year must be made on or before
April 30 of that Fiscal Year (or if such day is not a business
day, then on or before the next preceding business day) and shall
become irrevocable on that date with respect to that Fiscal Year.
Any cancellation of, or other change in, any such bonus reduction
election shall become effective with respect to the Fiscal Year in
which notice of such cancellation or change is filed if it is filed
on or before April 30 of that Fiscal Year (or, if such day is
not a business day, then on or before the next preceding business
day); otherwise, it shall become effective with respect to the
Fiscal Year next following the Fiscal Year in which it is
filed.
1
Restricted Stock shall be issued or
allocated to the account of the Participant in respect of any such
bonus reduction on the date that such bonus is otherwise
payable.
If a Participant who has elected a
bonus reduction hereunder shall terminate employment before shares
of Restricted Stock are issued or allocated in respect of such
bonus reduction, such election shall be deemed canceled and any
bonus compensation due to the Participant shall be paid in cash,
subject to compliance with the requirements of
Sections 409A(a)(2) and (3) of the Code.
2.
Company Matching Contribution.
For each four shares of Restricted
Stock acquired by the Participant pursuant to Section 1 above,
whether in respect of base salary or bonus reductions, the Company
shall simultaneously issue or allocate to the account of the
Participant, for no additional consideration, one additional share
of Restricted Stock (the “Company Match”), including
fractional shares where necessary.
3.
Terms of Restricted Stock.
(a) The Restricted Stock is
subject to forfeiture as provided herein and, during the
Restriction Period defined below, may not be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of by the
Participant, other than by will or by the laws of descent and
distribution of the state in which the Participant resides on the
date of his death. The period during which the Restricted Stock is
not vested and is subject to transfer restrictions is referred to
herein as the “Restriction Period.”
(b) Except as otherwise
provided in this Agreement or the Plan, each share of Restricted
Stock shall vest and no longer be subject to forfeiture or any
transfer restrictions hereunder on the third anniversary of its
acquisition by the Participant, so long as the Participant has
remained continuously employed by the Company from such acquisition
date through such third anniversary.
(c) In the event of
(i) the Participant’s termination of employment with the
Company by reason of death or Disability (for purposes of this
Section 3, “Disability” shall have the meaning set
forth in Section 409A(a)(2)(C) of the Code at any time such
definition is more restrictive than the Plan definition of
“Disability”), (ii) his termination of employment
with the Company on or after his attainment of eligibility for
retirement (as determined by the Board from time to time), or
(iii) a Change in Control (provided that such Change in
Control also constitutes a “change in ownership or effective
control” of the Company within the meaning of
Section 409A(a)(2)(A)(v) of the Code), any portion of the
Restricted Stock that has not vested shall immediately vest and no
longer be subject to forfeiture or any transfer restrictions
hereunder; provided that in the case of a Participant who is a
“specified employee” within the meaning of
Section 409A(a)(2)(B) of the Code, such Restricted Stock shall
not vest before the date which is six months after the date of the
Participant’s separation from service (or, if earlier, the
date of his death). If the Participant’s employment with the
Company is terminated for any other reason, voluntarily or
involuntarily, prior to the expiration of the Restriction Period
for any shares of Restricted Stock acquired pursuant to this
Agreement by the Participant, then (X) any portion of the
Restricted Stock acquired by the Participant pursuant to the
Company Match that has not vested as of the date of employment
termination shall immediately be forfeited, ownership shall be
transferred back to the Company (and any dividends or other
distributions with respect thereto p
